Simplified Proforma for Incorporating Company Electronically (SPICe)-Though sounds spicy but Government hidden initiative is to make the whole incorporation process Short and Sweet
Growth and expansion are key goals for most business owners and entrepreneurs. Whenever any business owner wishes to establish its footprints in India, the first and the foremost thing required for him is to get the legal status for his business which is recognized in the local laws. The most popular, recognized and safe way to expand and establish a business in India is through incorporating a Company under the Companies Act, 2013. In past years incorporating a Company was a big deal and challenge as the process was very complicated and time consuming. The need was felt from a long time to make the process simplified and less time consuming.
Appreciable steps are being taken by the Ministry of Corporate Affairs (MCA) which also includes modification in existing rules of incorporation of the Company and making the process simplified. As a part of initiative the Ministry has introduced a new E-form known as SPICE which stands for Simplified Proforma for Incorporating Company Electronically. All the other existing forms for incorporating a Company in India were ruled out after incorporating the new rules and after introduction of SPICE. The main highlight of Form SPICE is e-Form SPICe (INC-32) deals with the single application for Reservation of Name, Incorporation of a new Company, application for allotment of Director Identification number (DIN) and application for Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN).For the first time PAN and TAN allotment has been integrated with the process of company incorporation.
MCA introduced first SPICe form with the provisions for filing eMOA and eAOA. While incorporating a company, preparation of Memorandum of Association and Articles of Association takes significant time. To simplify this and standardize the charters of all companies registered in India, the SPICe form with eMOA and eAOA was launched. As a part of digital India and green initiative the requirement of having the physical copy of MOA and AOA is abolished and now the Company is mandatorily required to file the copies of its MOA and AOA electronically in the E-Form INC- 33 and INC-34 respectively.
Another main highlight of SPICE is that the Company need not have to apply separately for PAN and TAN and SPICE itself comprises the application for PAN and Tan which the Company has to mandatorily opt for. This saves the time and cost on the part of Company as well as on the part of professionals for making the separate application.
Once all the requirements are fulfilled and the documents as mandated are properly filed with Ministry, the incorporation along with the PAN and TAN of the Company can be completed within 2-3 days or less.
Advantages of SPICE Form:
- Time and Cost is saved for making the separate applications
- Single window for Company Incorporation along with the DIN,PAN, TAN, Reservation of Name.
- A major step move towards digital India and minimum involvement of paperwork.
- Speed up the process of obtaining necessary approvals.
- Out of the 190 countries in the list, India Ranks 130 overall in the World Bank Ease of Doing Business Report and ranks 155 in terms of starting a business.
Mandatory to file e-Form INC-32–
This form available on MCA w.e.f. 03.10.2016.Ministry has moved toward with notification dated 29thDecember, 2016 by this notification Companies can be incorporated only by following forms:
- One Person Company = INC-32 (SPICe )
- Private Limited Company (with7 or less than 7 subscribers) = INC-32 (SPICe )
- Public Limited Company (with7 or less than 7 subscribers) = INC-32 (SPICe )
- Section 8 Company(with7 or less than 7 subscribers) = INC-32 (SPICe )
- Producer Company (with7 or less than 7 subscribers) = INC-32 (SPICe )
- Producer Company (with more than 7 subscribers) = INC-7
- Company with foreign Subscribers (up to 7) = INC-32 (SPICe )
Attachment in SPICe -e (INC-32) form:
- e-MOA & e-AOA required to be file as linked form.
- INC-9 Affidavit and declaration by first subscriber(s) and director(s) (on duly authorized Stamp Papers).
- DIR-2 declaration from first Directors along with Copy of Proof of Identity and residential address.
- NOC from the owner of the property.
- Proof of Office address (Conveyance/ Lease deed/ Rent Agreement etc. along with rent receipts);
- Copy of the utility bills (not older than two months)
- Declaration from the director non acceptance of Deposit. (on duly authorized Stamp Papers).
- In case of subscribers/ Director does not have a DIN, it is mandatory to attach: Proof of identity and residential address of the subscribers
- E- 49A and 49B will be file on MCA website (filed form will be generate by the SRN of INC-33)
By introduction of SPICE form, doing business in India has become very easy and promotion of startups is the main motive of this initiative. Not only the startups are encouraged but the foreign investors are also attracted to establish their place of business in India without following the tedious and time consuming process of filing number of applications and getting their approval.
The main objective of launching this e-format proforma SPICe is to provide speedy incorporation related services within stipulated timeframe, uniformity in application of rules and eradicating discretion, to be in line with international best practices.
Compiled by: CS Akhtar Hussain